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The FRC’s Enforcement Committee has fined Crowe UK LLP £144,000 after concluding it failed to comply with regulatory framework for its audit of Aseana Properties Limited’s financial statements for the year ended 31 December 2019.
The authority found failures in the reviewed audit, which it considered had been “unsatisfactory and, overall, a poor-quality audit”.
It found the most “significant failing” was in respect of the carrying value of inventory. The committee identified other areas of concern in respect of the assessment of fraud risk and EQCR oversight.
Following the identified failures, the FRC said it considered it was necessary to impose a sanction of £180,000, adjusted by a discount of 20% to £144,000, for co-operation and steps taken to ensure non-repetition.
In addition, it has accepted written undertakings proposed by Crowe UK LLP, which will be monitored by the FRC’s audit quality review team.
The committee said it also acknowledges that Crowe “provided co-operation, including at an early stage, and took appropriate remedial steps once the failings were identified”.
A spokesperson from Crowe UK said: “We are pleased the matter has been settled. We have continued to develop our audit methodology and guidance in the four years since the work was carried out and to make significant investment in our audit business. Audit quality and its continuous improvement remain a key priority for the firm.”
